Cone Health of Greensboro said it completed its merger into Risant Health, ending 71 years of local ownership of the Gate City’s largest hospital operation. Risant Health has committed a minimum of $1.4 billion in capital to Cone Health over the next five years and up to $300 million more over the 10 years following the closing date.
That includes at least $1 billion in capital for investments in facilities, health equity and other capital projects. The money can come from Risant or Cone’s “internally generated” funds.
Risant Health will “assure funding” of $400 million to support Cone Health’s transition and integration, and a further $300 million for Cone’s growth opportunities in the 10 years following the closing date.
The transaction involved no purchase price because the Greensboro hospital’s board thought joining Oakland, California-based Risant was more beneficial than selling the not-for-profit system to the highest bidder.
Cone Health is maintaining its name, brand, and mission, according to a release. Its board, CEO, enterprise leadership team, and medical staff are also remaining, while the company continues to work with other health plans, provider groups and independent physicians.
The Kaiser Foundation Hospitals created Risant Health to assemble “like-minded organizations, increase access to value-based care and coverage, and raise the bar for approaches that bring the best health outcomes,” according to the release. The Kaiser Foundation includes the Kaiser Permanente system, which has been a pioneer in the health-maintenance organization (HMO) industry.
Risant wants to accelerate the adoption of value-based care in which patients typically pay for more holistic care, rather than the traditional fee-for-service model.
Cone is the second nonprofit health system to become part of Risant, joining Pittsburgh-based Geisinger.
“We are proud to be building a strong group of health systems committed to value-based eager for Cone Health to bring ideas and expertise to the table to continue to scale access to value-based care and improve the health of millions.”
Cone Health CEO Dr. Mary Jo Cagle said “becoming part of Risant Health accelerates our mission to deliver on the promise of better care at lower costs for all.”
Cone Health said it brings experience advancing value-based care to include various payers and a broad network of providers, while serving many vulnerable and marginalized communities. The goal is to improve health outcomes, increase access to care and lower total cost of care.
Cone Health was formed in 1952 and now employs 13,000 people and more than 700 physicians, plus 1,800 partner physicians. It has four acute-care hospitals, a behavioral health facility, an accountable care organization and a health plan. Ed Cone, a descendant of the founding Cone family, is a board member.
It is a dominant hospital operator in Guilford and Alamance counties, while facing competition from the Novant Health and Atrium Health networks in the Triad and Duke Health and UNC Health to the east.
Kaiser is much larger than those organizations, reporting $100 billion in revenue in 2023. Cone Health had revenue of $2.8 billion last year.